Decoder
Service design is an approach to planning and optimizing the way services are delivered that focuses on improving outcomes for customers and the business.
It can be a powerful way to encourage and enable customer-centricity in any organization, increasing the effectiveness and efficiency of services to drive revenue and profit. Service design also provides a holistic, cohesive approach to delivering services that span multiple departments, or even multiple organizations.
Service design is a customer-centric approach to designing and delivering services that provide better outcomes for customers and the business.
Customer-centric design is a major factor in driving revenue. And service design also focuses on the profitability and repeatability of the way services are delivered.
This approach requires investing in people, tools, and methods to support complimentary disciplines that are vital for analyzing processes and measuring performance
Service design is used to improve experiences in sectors with high volumes of customer interactions. It’s also an ideal way to tackle complex, open-ended problems where service experiences span numerous organizations.
What is it?
Service design involves the understanding and planning of how services — experiences containing products, people, and processes — are designed and delivered. The aim is to improve the experience and its outcomes, both for service users and for the business.
The approach examines all the ways that people interact with the service, at every stage of the experience. It also considers how the people, processes, and digital systems in the background deliver the service.
Importantly, service design also measures the effectiveness and efficiency of service delivery, based on clearly defined metrics, to identify opportunities for continuous improvement.
What’s in it for you?
Research by McKinsey has shown that companies with a highly customer-centric approach to design consistently outperform their counterparts in revenue generation.
Service design shifts the emphasis from delivering products (the outputs) to delivering solutions (the outcomes) and encourages organizations to see themselves as part of an ecosystem with the customer at its center. This customer-centric approach brings to light how the organization can deliver new value to customers and fosters a culture of listening to customers and adapting to their needs.
While service design requires a laser-focus on customer needs, it also looks at how the delivery of great customer experiences can be more profitable and repeatable for the business.
What are the trade offs?
Service design is about understanding interactions and processes in numerous areas of the business that combine to deliver the experience, so to be effective it needs time and effort from a broad range of stakeholders.
A service design approach typically requires skills and investments in complementary disciplines — including value stream analysis, process mapping, and data science — that help organizations understand the individual processes that deliver the service.
Also, it’s vital that organizations capture and analyze performance data to design, maintain, and optimize profitable services. That requires further investments in tools, people, and processes for data gathering and analysis.
How is it being used?
Service design is useful for tackling open-ended, ambiguous problems that have implications beyond individual departments or organizations.
Organizations in government, financial services, and healthcare use service design to handle the rapidly increasing demand for interoperable services and customer-led service interactions.
In fact, businesses of any size can benefit from service design. Large enterprises, for example, can identify cross-dependencies and duplicated processes to prevent siloed departments from delivering a fragmented service. And mature startups that want to scale their product offering can consolidate their activities across marketing, support, and sales to build a repeatable, compelling, and stable conversion pipeline.
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